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Paper info: Electronic Marketing and Purchasing

Title


Electronic Marketing and Purchasing

Authors


Aberdeen Leila Borders, Edward E. Rigdon and
Wesley Johnston
Georgia State University
United States
Wesley Johnston

Place of Publication


The paper was published at the 16th IMP-conference in Bath, U.K in 2000.

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Abstract


In the past thirty years, we have moved from the traditional exchange models of?explaining? and ?managing? to the phenomena of the electronic revolution in buyersellernetworks, the development of network formations, and the impact of electroniccommunications such as electronic data interchange (EDI) and the internet onelectronic commerce. These network approach models emphasize ?understanding?and ?developing? relationships in business networks (Johnston and Lewin 1996). Vanden Poel and Leunis (1999) studied the capabilities of the World Wide Web (WWW)as a new type of non-store retailing in which the Internet is a direct link between theconsumer and the retailer or producer, bypassing the traditional store. Althoughretailers typically have lower costs of operating a commercial activity on the Internetcompared with a brick-and-mortar store, non-store buying is perceived to be morerisky than retail store buying (Van den Poel and Leunis 1999; Spence et al., 1970;Festervand et al., 1986). One main reason for this is that customers are often unableto physically inspect products before the purchase. Their research confirms earlierfindings that money-back guarantee is the most important risk reliever, followed byoffering a well-known brand and a price reduction for Internet shoppers.However, firms are seeing the value in customer account relationship managementeven for small customers. Oliver (1997) points out that everybody is not"technothrilled." Some customers do not mind paying a premium to keep the personto-person contact when shopping (salespeople, clerks, and cashiers). Thus, when emarketersobtain customers they must be proactive to keep the customer from?clicking-off? their site.Oliver also suggests that electronic shopping might be context-dependent. Theelectronic experience is preferred at different times for different products. Oliver'scontext-dependent model for purchasing goods and services conceptualizes threelevels of commerce ("marketplace" where personal interaction, ritual and sense ofcommunity predominate; ?marketspace? which includes things that can be digitizedand/or have strong brands that can be easily described and understood by vendor andpurchaser; and ?customerspace? where customers create their own goods or level ofservice. All three levels fall under the electronic market umbrella. In turn, a growthin the functions of ?butlers,? ?intelligent agents,? and ?gatekeepers? will prevail(Oliver 1997). The ?butler bundles the inputs of the person being served and deliversthem completed ? not the ingredients of a meal, but the meal itself. ?Intelligentagents? are electronic versions of butlers. The intelligent agent is a search-and-findtool for the Internet or other electronic shopping service. The challenge in marketing,as it always has been, is to give the customer what he, she or it wants - - whether it isthe product or service, or the ability to create the product or service.The purpose of this paper is to contrast the old models of dyadic and networkmarketing to the electronic marketing and purchasing paradigms that are emerging.Buyer-seller relationships will be transformed. Networks will be electronically wiredto rapidly communicate end consumption through out the entire value chain. A greatdeal of the existing marketing infrastructure will be disintermediated and left obsolete.It is also possible that industrial marketing and purchasing, as we know it will vanish.The terms customer relationship management and enterprise resource planning maycompletely replace the terms of marketing and purchasing.